Valentine’s Day is done, all the major early year holidays are done, the clocks are jumping forward again on March 14th, and that means there are no more excuses. It is time to go back to work. Sorry, the next holiday won’t be until May 31st. Bummer. Who knows, maybe we will be able to go to Vegas without feeling guilty by then.
So, what’s up? Mortgage refinance rates are up! Increased rates are not stopping the willing and able from that refinance. But (there is always that but…) loan officers are moaning that the pipeline is still clogged. From my general calculations, those refis that I have opened are taking 60 – 90 days to close. That means what you want at the beginning may not be what you get at the very end.
By the way, March will start the new 1003 form for Fannie and Freddie. Here is a link to the new form that will be used: Uniform Residential Loan Application. Different, eh? This has been in the works since last year but they extended the roll out date to March 1.
Real estate price values are up! Interest in purchases are up and up! But real estate brokers are moaning that their clients cannot find the right property at an affordable price and are outbid when they do. If you are a RE agent and you are not moaning, share with us what you are doing right. Inquiring minds want to know.
Income is up! At least for the twins – Fannie and Freddie. The scuttlebutt is that the twins funded 1.2 million AMF qualified mortgages to a tune of $350 billion, and by doing the math, the “adverse market fee” (AMF) .50% equals to $1.75 Billion (with a “B”). If this is true, and I haven’t found any FHFA related articles to substantiate this yet, that is a LOT of money from origination fees paid by the consumer. Will FHFA allow this AMF to continue through the pandemic? It’s not holding anyone back from refinancing but reading about the money galls when people can’t pay rent, can’t pay mortgages and losing their jobs every day across the country. Hopefully this money goes back to the consumer as part of the $1.9 Trillion (with a “T”) pandemic aid bill but I don’t know if government agencies like sharing their largesse…
What other income is up? Mortgage companies! Rocket mortgage posted 9.5 Billion income (there’s that “B” again) from $107.2 billion in mortgages generated during the 4th quarter of 2020 and we all know about LoanDepot’s IPO…
As you see in this report the housing industry affects every other industry (some you don’t even think of on a daily basis) and businesses large and small. Keeping a close watch helps us plan our lives in the next 12 months. Do I have to hire more staff? Do I lay off people? Can I “take a vacation”? Should I be reporting on lumber prices next?
Forbearance and the escrow industry. FHFA is extending forbearances period for up to 15 months. Is this good? Is this bad? Depends on which side of the fence you are on. When does a forbearance affect the Escrow Officer? When we have to make heads or tails out of the figures in the clients’ payoff demands. Why is there a “negative”? Why does the interest show “paid to May 1” and we are only in March 1? Why is there an amount of $20,000 added on? Why is there a second mortgage to payoff? You don’t figure it out right and you give it to the client, he may end up short in funds. Forbearance does not mean the amount unpaid is waived. The piper needs to be paid, sooner or later. No free lunch, etc. etc. FHA loans even record a junior lien on the property for the unpaid amount. The Escrow Holder must not only review the payoff demand carefully but also the preliminary title report in case there is a 2nd loan. By the way, this will be a topic for an “Escrow Tip” in my Think Escrow channel!.
Talking about my Escrow Tip series, be sure you go to my Think Escrow! Channel on YouTube to check out my Escrow Tips. Last month I put up my Escrow Tip #1 regarding City Reports. This month, at this link below, check out my Escrow Tip #2.
My YouTube offering for the month:
Escrow Tip #2
Table Funding! Dry State! Wet State! What???
And for my public announcement for the month (because we need more bad news, right?) – the Top Frauds of 2020 as put out by the Federal Trade Commission is information we need, we know, but are we protecting ourselves? Top on the list is imposter scams. Second is online shopping issues.
And finally, not so much a “funny” but this video strikes a chord in the very heart of every Escrow Officer. It’s called “How To Land Without Wheels”, because, seriously, just like those dudes, every Escrow Officer, from time to time, knows the feeling of sitting in the cockpit of a transaction gone south and wondering how they will land.
You Have Questions? We Have Answers!
Juliana Tu, CSEO, CEO, CBSS, CEI, SASIP
“Escrow is my FOREMOST language!”
Advance Disclosure:
The opinions expressed in this blog are solely the author’s.
Your comments and viewpoints are always welcome.
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